It´s probably your worst nightmare: having your identity stolen. And, unfortunately, it can take quite some time to restore your good name. However, it is possible to take the appropriate steps to getting everything cleared up and re-establishing your credit score. You may find yourself explaining your predicament when it comes to getting a loan, but if you make sure that you take the proper steps, it can be a minimal amount of explanation.
Here is what you should do when you discover a fraudulent account on your credit report or suspicious charges on your credit card statement:
- Notify the bank or credit card company that holds the fraudulent account.
- Close the account in question.
- Notify local authorities. Get a copy of the police report. Nothing may ever happen, but you should have the proof of your early and decided attempt to "get the guy."
- Contact the national authorities. The Federal Trade Commission has a handy form that you can use.
- Call all three credit bureaus and notify them of your situation. Ask for a flag on your credit report, indicating that you have been an identity theft victim. You may need documentation.
- If needed, follow up with the bank or credit card company that has the fraudulent account to make sure that it does its part to notify all three credit bureaus of the problem.
It can take months, or even years, to get an identity fraud item fixed. However, it is very important that you act quickly to remedy the situation. As soon as you find out, you should take action. This is where closely monitoring your financial statements and checking your credit report regularly comes in handy (read my post about getting a free credit report three times a year here).
When you go to get loans as a victim of identity fraud, you may have a bit of trouble. Argue for the interest rate you deserve if you feel that your credit score is still depressed because of the identity theft problem. When buying a home, if you are asked to include a letter of explanation for your credit status, make sure that you state your identity fraud problem, and outline the immediate steps you have taken to clear it up. However, with the proper notation on your credit report, most lenders will make the proper adjustments.